With a surprise announcement by the Central Bank of the Republic of Turkey (CBRT), the policy rate was raised to 40%. With this news, the dollar exchange rate dropped significantly.
According to the CBRT's latest announcement, after a bold interest rate hike of 500 basis points in the previous month, the CBRT raised the interest rate again by 500 basis points in November, exceeding market expectations.
Interest rates, which were previously as low as 8.5%, have been raised as high as 40% as a result of the decisions taken in the last six months.
The Central Bank stated that the policy rate decision was taken in a way to create fiscal and monetary conditions that will bring inflation under control and reach the 5% target in the medium term.
The Bank also emphasized that foreign direct investments, the improvement in external financing conditions, the increase in reserves and the contribution of tourism revenues to the current account will strengthen price stability.
With the higher-than-expected announcement of interest rates, Tether (USDT) lost value against the Turkish Lira. Tether, which reached 29.12 TL before the announcement, fell 0.7% to 28.9 TL after the announcement.